It was certainly a poor choice of words by the poster and doesn't paint insurance in a good light....... not sure if he's clarified or expanded on his comments but.....
No one in the global insurance market will 'make a packet' from a large event, far from it, it'll cost billions, maybe triple figure bn, that's what insurance/reinsurance/retrocession is for, the premiums of the many pay for the claims of the few.
I think what the poster is trying to refer to (has he/she replied again?) is that because there have been no events for some time rates have dropped to an unsustainable level across the board, insurance, reinsurance & retrocession is as soft a market as I've seen in nearly 30 years, but that is to an extent of the industries own making. A large event usually has the effect of having a correction in pricing (call it a wake up call if you like). You've also seen entrants such as Hedge and Pension funds putting up huge sums of money for Reinsurance on the basis of many benign years - they are certainly set for a wake up call.
But I disagree, on purely an insurance basis this would be a good thing for the industry anyway and that's before the tragic nature of events such as this. Some in my industry (sadly) will disagree, but that's how I see it.
Insurance is there to protect and help rebuild post these events (just the same as your car, house or life insurance), but posts like the above put the industry in the 'banker' grouping of recent years (apology to any bankers!) rather than seeing it as a much needed product and service in what can be very traumatic times.
No offence Rob, but insurance is no more 'there to protect and help rebuild' than IT systems are 'there to make peoples' lives easier'
It's there to make other people money. Difference between the profession I'm in and lots of other professions is that most of us in IT are cynical enough to admit that we're engaged in fucking people over
That post - even if it was innocently intended and poorly worded - was one of the most cold-heartedly callous things I've seen posted on here
No offence Rob, but insurance is no more 'there to protect and help rebuild' than IT systems are 'there to make peoples' lives easier'
It's there to make other people money. Difference between the profession I'm in and lots of other professions is that most of us in IT are cynical enough to admit that we're engaged in fucking people over
That post - even if it was innocent rlt intended toned and poorly worded - was one of the most cold-heartedly callous things I've seen posted on here
Sorry but that first part is bull. If you crash your car do you expect it to be repaired at your cost or the insurers? If you sadly passed would you expect your life insurers to pay out your policy to help those you've left behind?
Of course insurance companies are there to make money (there are still a few mutual arpund), they are a business but the premise of insurance is to put you back into a position that you were before a loss. Just ask those who have suffered a flood, house fire etc who weren't insured, financial ruin or those who did have insurance and were extremely grateful for it.
What would happen if there was no insurance? I'm not trying to portray the industry as fantastic or up there with the RNLI, but it does provide an essential product (to most).
BTW I'm not defending the post in any way shape or form.
insurance is no more 'there to protect and help rebuild'
It's there to make other people money.
Sorry but that first part is bull. If you crash your car do you expect it to be repaired at your cost or the insurers?
If I crash my car I expect my insurer to pay out, sure. They'll then hike my premiums as will all the others out there.
However they're also insuring against damage I do to others.
If I don't crash but get crashed into they lose nothing, instead they can hike my premium as my pristine driving record is... no longer pristine.
If you're high risk, you pay through the nose, if you're low risk you pay for years without ever needing to have paid. (Ignoring legal implications there)
HOWEVER It's like a johnnie isn't it. It's better to have one and not need one, than to need one and not have one. #johnniejacksonweloveyou
No offence Rob, but insurance is no more 'there to protect and help rebuild' than IT systems are 'there to make peoples' lives easier'
It's there to make other people money. Difference between the profession I'm in and lots of other professions is that most of us in IT are cynical enough to admit that we're engaged in fucking people over
That post - even if it was innocent rlt intended toned and poorly worded - was one of the most cold-heartedly callous things I've seen posted on here
Sorry but that first part is bull. If you crash your car do you expect it to be repaired at your cost or the insurers? If you sadly passed would you expect your life insurers to pay out your policy to help those you've left behind?
Of course insurance companies are there to make money (there are still a few mutual arpund), they are a business but the premise of insurance is to put you back into a position that you were before a loss. Just ask those who have suffered a flood, house fire etc who weren't insured, financial ruin or those who did have insurance and were extremely grateful for it.
What would happen if there was no insurance? I'm not trying to portray the industry as fantastic or up there with the RNLI, but it does provide an essential product (to most).
BTW I'm not defending the post in any way shape or form.
Well it's repaired at the expense of the policy holders who havn't made a claim. Yes insurance companies are necessary but often their worming, squirming behaviour is despicable to us mere customers.
The post in question was nothing short of disgraceful.
No offence Rob, but insurance is no more 'there to protect and help rebuild' than IT systems are 'there to make peoples' lives easier'
It's there to make other people money. Difference between the profession I'm in and lots of other professions is that most of us in IT are cynical enough to admit that we're engaged in fucking people over
That post - even if it was innocent rlt intended toned and poorly worded - was one of the most cold-heartedly callous things I've seen posted on here
Sorry but that first part is bull. If you crash your car do you expect it to be repaired at your cost or the insurers? If you sadly passed would you expect your life insurers to pay out your policy to help those you've left behind?
Of course insurance companies are there to make money (there are still a few mutual arpund), they are a business but the premise of insurance is to put you back into a position that you were before a loss. Just ask those who have suffered a flood, house fire etc who weren't insured, financial ruin or those who did have insurance and were extremely grateful for it.
What would happen if there was no insurance? I'm not trying to portray the industry as fantastic or up there with the RNLI, but it does provide an essential product (to most).
BTW I'm not defending the post in any way shape or form.
Stop falling into the trap Rob. Insurance is a necessity, but don't try and dress it up as some essential service like the NHS, Police, Ambulance etc that exists to protect society. It doesn't. Honestly - if you just accept that the industry you work in exists to exploit people, it's liberating. Did me the power of good when I started moving up in IT and saw just how it screwed people (automation doing them out of jobs completely, downskilling their work, piling more work on them etc) - I had an epiphany of sorts. Insurance exists to make money out of people. It's licensed gambling where the game is rigged in favour of the house and the punter inevitably loses.
From a personal standpoint, I am hoping for the best and wish everyone stay safe. From a professional(insurance) standpoint the global insurance market and Cat bond market needs this to be another big one which will hopefully pull up global Insurance market rates.
You sound like a decent, rounded, empathetic sort of fella.
No offence Rob, but insurance is no more 'there to protect and help rebuild' than IT systems are 'there to make peoples' lives easier'
It's there to make other people money. Difference between the profession I'm in and lots of other professions is that most of us in IT are cynical enough to admit that we're engaged in fucking people over
That post - even if it was innocent rlt intended toned and poorly worded - was one of the most cold-heartedly callous things I've seen posted on here
Sorry but that first part is bull. If you crash your car do you expect it to be repaired at your cost or the insurers? If you sadly passed would you expect your life insurers to pay out your policy to help those you've left behind?
Of course insurance companies are there to make money (there are still a few mutual arpund), they are a business but the premise of insurance is to put you back into a position that you were before a loss. Just ask those who have suffered a flood, house fire etc who weren't insured, financial ruin or those who did have insurance and were extremely grateful for it.
What would happen if there was no insurance? I'm not trying to portray the industry as fantastic or up there with the RNLI, but it does provide an essential product (to most).
BTW I'm not defending the post in any way shape or form.
Stop falling into the trap Rob. Insurance is a necessity, but don't try and dress it up as some essential service like the NHS, Police, Ambulance etc that exists to protect society. It doesn't. Honestly - if you just accept that the industry you work in exists to exploit people, it's liberating. Did me the power of good when I started moving up in IT and saw just how it screwed people (automation doing them out of jobs completely, downskilling their work, piling more work on them etc) - I had an epiphany of sorts. Insurance exists to make money out of people. It's licensed gambling where the game is rigged in favour of the house and the punter inevitably loses.
With Leroy on this one. Insurance doesn't "put you back into a position that you were before a loss". It might reduce your losses but you're kidding yourself if you think you won't lose on the deal (excesses / hiked premiums).
It came home to me at the weekend when I was looking at renewal (how come the premium goes up each year when there has been no claim for 20+ years and the car has depreciated in value?) and it occurred to me that we had been paying 50+ years of car insurance and 25+ years of house insurance for 3 claims totalling less than £3k. Insurance companies might carry the risk, but by God they set pretty poor odds.
It was certainly a poor choice of words by the poster and doesn't paint insurance in a good light....... not sure if he's clarified or expanded on his comments but.....
No one in the global insurance market will 'make a packet' from a large event, far from it, it'll cost billions, maybe triple figure bn, that's what insurance/reinsurance/retrocession is for, the premiums of the many pay for the claims of the few.
I think what the poster is trying to refer to (has he/she replied again?) is that because there have been no events for some time rates have dropped to an unsustainable level across the board, insurance, reinsurance & retrocession is as soft a market as I've seen in nearly 30 years, but that is to an extent of the industries own making. A large event usually has the effect of having a correction in pricing (call it a wake up call if you like). You've also seen entrants such as Hedge and Pension funds putting up huge sums of money for Reinsurance on the basis of many benign years - they are certainly set for a wake up call.
But I disagree, on purely an insurance basis this would be a good thing for the industry anyway and that's before the tragic nature of events such as this. Some in my industry (sadly) will disagree, but that's how I see it.
Insurance is there to protect and help rebuild post these events (just the same as your car, house or life insurance), but posts like the above put the industry in the 'banker' grouping of recent years (apology to any bankers!) rather than seeing it as a much needed product and service in what can be very traumatic times.
Apologies in advance if I'm misinterpreting your point and I very likely am tbf but is what you are saying, "...A large event usually has the effect of having a correction in pricing" because, "...rates have dropped to an unsustainable level across the board..." not just another way of saying that a large natural event like this, that results in lots of claims, is a good excuse to hike up the premiums to a level that the industry does consider sustainable?
The Met Office have just announced one of our next storms will be called Brian. It'll probably be no more than a draught, I mean has anybody ever been scared of a Brian.
The Met Office have just announced one of our next storms will be called Brian. It'll probably be no more than a draught, I mean has anybody ever been scared of a Brian.
The Met Office have just announced one of our next storms will be called Brian. It'll probably be no more than a draught, I mean has anybody ever been scared of a Brian.
I know of a few England bowlers who were.
There were a few batsmen afraid of a certain Brian also.
Wow, wasn't expecting so many replies, can't quote everyone but will try to pick up the key points;
I didn't compare the insurance industry and the service it provide to the NHS etc, in fact I specifically said it's not comparable (using the RNLI as an example) but that it does provide what many consider an essential service (I doubt there are many people on here who don't have some form of insurance).
The basic principle of insurance is that the premiums of the many pay for the claims of the few. So of course for everyone who claims £100k when their house has a fire despite only paying an annual premium of say £500 means insurers need probably 300 to pay £500 and not to claim. Hence why people who haven't claimed will question 'where's my money gone' - you have to view it like a pool, you might need to make a claim yourself at some point even if you haven't currently.
Over the cycle (say 10-15 years) insurers will aim to make about 5% per annum, the UK government will take more than double that, risk free - don't recall the last time the average jo public complained about that 12% of their premium.
Insurance and rates are cyclical, particularly in property cat where it's all or nothing (I'll come onto motor insurance), so when we've had a lengthy period of no losses premiums drop through the floor to the extent that the premiums of the many in that period will not cover the next big loss. We are quite easily talking here of this hurricane being a 100bn+ insured loss and I doubt the net premiums since hurricane Wilmer in 2005 will cover that. It's not a case of an excuse to hike up the rates, if over a cycle insurers/reinsurers do not break even there will be no insurance market as they'll be no money to pay claims.
Motor insurance is the one I struggle/disagree with - it's all priced on statistics and computers. It's a fact that the stats show someone who has a non fault claim is more likely to then have a fault claim that someone who didn't, hence why some insurers see post that non fault claim you being in a higher risk category and therefore premium. My arguement always is that you can run stats on hair colour and likely to cone out with a higher risk group..... the rating has gone too far. Very little of your motor premium is actually for the damage element, the majority is liability element and that's where the costs have increased considerably.
I won't bore you with an essay on the detail but google 'Ogden rate' - the reason motor insurance rates (and all other liability insurance) have recently gone up considerably is due to the government changing the Ogden discount rate. In one day that increased existing large liability claims by 100's of millions if not billions, and yes that additional cost is passed onto policy holders.
Lastly, the rates insurers charge as well as risk rating have many other factors. For instance 25 years ago motor insurers were happy to pay out £110 in claims for every £100 they received in premium. The motor market made an underwriting loss for 20 straight years from around 1985. That may seem odd, but in those days they would invest the premiums and easily make 20 points on investments so the business model was less about underwriting margin and more around investment.
You've probably all nodded off by now, but hope it clarifies my post and I'd reiterate my equal distain to the post we've all been talking about.
Wow, wasn't expecting so many replies, can't quote everyone but will try to pick up the key points;
I didn't compare the insurance industry and the service it provide to the NHS etc, in fact I specifically said it's not comparable (using the RNLI as an example) but that it does provide what many consider an essential service (I doubt there are many people on here who don't have some form of insurance).
The basic principle of insurance is that the premiums of the many pay for the claims of the few. So of course for everyone who claims £100k when their house has a fire despite only paying an annual premium of say £500 means insurers need probably 300 to pay £500 and not to claim. Hence why people who haven't claimed will question 'where's my money gone' - you have to view it like a pool, you might need to make a claim yourself at some point even if you haven't currently.
Over the cycle (say 10-15 years) insurers will aim to make about 5% per annum, the UK government will take more than double that, risk free - don't recall the last time the average jo public complained about that 12% of their premium.
Insurance and rates are cyclical, particularly in property cat where it's all or nothing (I'll come onto motor insurance), so when we've had a lengthy period of no losses premiums drop through the floor to the extent that the premiums of the many in that period will not cover the next big loss. We are quite easily talking here of this hurricane being a 100bn+ insured loss and I doubt the net premiums since hurricane Wilmer in 2005 will cover that. It's not a case of an excuse to hike up the rates, if over a cycle insurers/reinsurers do not break even there will be no insurance market as they'll be no money to pay claims.
Motor insurance is the one I struggle/disagree with - it's all priced on statistics and computers. It's a fact that the stats show someone who has a non fault claim is more likely to then have a fault claim that someone who didn't, hence why some insurers see post that non fault claim you being in a higher risk category and therefore premium. My arguement always is that you can run stats on hair colour and likely to cone out with a higher risk group..... the rating has gone too far. Very little of your motor premium is actually for the damage element, the majority is liability element and that's where the costs have increased considerably.
I won't bore you with an essay on the detail but google 'Ogden rate' - the reason motor insurance rates (and all other liability insurance) have recently gone up considerably is due to the government changing the Ogden discount rate. In one day that increased existing large liability claims by 100's of millions if not billions, and yes that additional cost is passed onto policy holders.
Lastly, the rates insurers charge as well as risk rating have many other factors. For instance 25 years ago motor insurers were happy to pay out £110 in claims for every £100 they received in premium. The motor market made an underwriting loss for 20 straight years from around 1985. That may seem odd, but in those days they would invest the premiums and easily make 20 points on investments so the business model was less about underwriting margin and more around investment.
You've probably all nodded off by now, but hope it clarifies my post and I'd reiterate my equal distain to the post we've all been talking about.
I did forget one point, a lot of the premiums we all pay never go towards claims as there are various levies that people outside of the industry are unaware of;
Did you know about 1/4 of the cost to run the London Fire Brigade is paid for out of insurance premiums? For every property insured in a London borough there is a levy of £35 per million of sums insured.
There is a levy (from memory about 8%) on some classes that goes to the FSCS to cover policy holder claims.
I've already mentioned insurance premium tax.
MIB is a levy on motor insurance premiums to cover the database of all motor insurance as well as to cover uninsured injury claims. There is a similar levy now for an employers liability database.
Take those out and add in say 20-25% of the premium in running costs it's on average about 50% is available for claims.
Thanks for that Rob, I appreciated the many pay for the few (and in that I'm the ideal customer) and the 80's investment model was enlightening and something I never realised. The statement I take umbrage with is about rates dropping which I haven't had the benefit of! I don't claim, but MY rates are always increased (admittedly I normally beat them down, but you can understand why some of us lump you in the shyster brigade :-) ). And, btw, I'm always moaning about insurance premium tax.....
Thanks for that Rob, I appreciated the many pay for the few (and in that I'm the ideal customer) and the 80's investment model was enlightening and something I never realised. The statement I take umbrage with is about rates dropping which I haven't had the benefit of! I don't claim, but MY rates are always increased (admittedly I normally beat them down, but you can understand why some of us lump you in the shyster brigade :-) ). And, btw, I'm always moaning about insurance premium tax.....
No worries, insurers aren't perfect and there are some bad apples - plenty I wouldn't give my money to.
On rates, are you talking motor? There's many reasons, some I e described above, a few others are:
Injury claims have gone up both in severity and number is the past 10 years - blame the ambulance chasing lawyer 'no win no fee' brigade
Car repairs - due to safety cars are built to crumple these days and therefore even minor bumps are expensive compared to what they once were (also paint but that's a whole other subject).
Mainly motor, every year whoever we're with seem to try it on with a 10-20% increase. Over the years I've chipped away at the house old for new and paint on the carpet silliness - all I'm really interested in is cover for fire/flood/theft and some twat driving into my front room. Don't get me started on injury lawyers; compared to them you're bloody mother Theresa!
Mainly motor, every year whoever we're with seem to try it on with a 10-20% increase. Over the years I've chipped away at the house old for new and paint on the carpet silliness - all I'm really interested in is cover for fire/flood/theft and some twat driving into my front room. Don't get me started on injury lawyers; compared to them you're bloody mother Theresa!
Household - IPT aside you should have seen a reduction these past 6-7 years. Rates are off about 15% so even the increase in IPT you should be paying less £'s, tried a broker?
A lot of the direct insurers, particularly on motor will hike it up each year often unnecessarily. My advice is find yourself a good broker, you won't see the hikes then and get a much better and more personal service.
Things like confused.com have made the public much more aware, but it's also led to a chase to the bottom and the majority of people won't care one jot who the insurer is just whose cheapest. This leads to the 'cheap rate for new customers' and higher rates for existing ones which in the long run isn't good.
My sister's house on Tortola in the British Virgin Islands took a direct hit as the eye rolled over the Island. She is in England at the moment but her husband is there and and she was talking to him as it hit and then all communication was lost. She's heard nothing since. Praying that all is well over there.
My sister's house on Tortola in the British Virgin Islands took a direct hit as the eye rolled over the Island. She is in England at the moment but her husband is there and and she was talking to him as it hit and then all communication was lost. She's heard nothing since. Praying that all is well over there.
Fuck man hopefully it's just a matter of communications being down. Hope he's okay.
Thoughts with your family @Rob and all the best to any others on hurricane watch.
We booked an October trip to Antigua a couple of weeks ago so I have been following with heightened interest, albeit from a rather selfish point of view. Seems Antigua got off lightly this time, though now Hurricane Jose is approaching. Barbuda, however, took the direct hit and seems to have been more or less obliterated - desperate for the people there.
Barbuda is part of same state as Antigua, but seems there are some big political differences - the Antiguan Gov issued a statement yesterday afternoon thanking anything and everyone for their escape - yet at that time there had been no contact with their tiny sister island.
My friend @SomersetAddick is currently in the Bahamas with his family including young grandsons but hopefully they will be flown home safely tonight.
Barbuda got hit hard. President estimates 95% of homes have sustained damage with roofs at least partly missing if not gone completely. Whole island 'reduced to rubble'
Barbuda got hit hard. President estimates 95% of homes have sustained damage with roofs at least partly missing if not gone completely. Whole island 'reduced to rubble'
Desperately sad times.
Their PM was on Radio 4 this morning and said he estimated the cost of rebuilding buildings and infrastructure to be in the order of $100m - relative peanuts for us but incomprehensible for them.
Comments
No one in the global insurance market will 'make a packet' from a large event, far from it, it'll cost billions, maybe triple figure bn, that's what insurance/reinsurance/retrocession is for, the premiums of the many pay for the claims of the few.
I think what the poster is trying to refer to (has he/she replied again?) is that because there have been no events for some time rates have dropped to an unsustainable level across the board, insurance, reinsurance & retrocession is as soft a market as I've seen in nearly 30 years, but that is to an extent of the industries own making. A large event usually has the effect of having a correction in pricing (call it a wake up call if you like). You've also seen entrants such as Hedge and Pension funds putting up huge sums of money for Reinsurance on the basis of many benign years - they are certainly set for a wake up call.
But I disagree, on purely an insurance basis this would be a good thing for the industry anyway and that's before the tragic nature of events such as this. Some in my industry (sadly) will disagree, but that's how I see it.
Insurance is there to protect and help rebuild post these events (just the same as your car, house or life insurance), but posts like the above put the industry in the 'banker' grouping of recent years (apology to any bankers!) rather than seeing it as a much needed product and service in what can be very traumatic times.
It's there to make other people money. Difference between the profession I'm in and lots of other professions is that most of us in IT are cynical enough to admit that we're engaged in fucking people over
That post - even if it was innocently intended and poorly worded - was one of the most cold-heartedly callous things I've seen posted on here
Of course insurance companies are there to make money (there are still a few mutual arpund), they are a business but the premise of insurance is to put you back into a position that you were before a loss. Just ask those who have suffered a flood, house fire etc who weren't insured, financial ruin or those who did have insurance and were extremely grateful for it.
What would happen if there was no insurance? I'm not trying to portray the industry as fantastic or up there with the RNLI, but it does provide an essential product (to most).
BTW I'm not defending the post in any way shape or form.
However they're also insuring against damage I do to others.
If I don't crash but get crashed into they lose nothing, instead they can hike my premium as my pristine driving record is... no longer pristine.
If you're high risk, you pay through the nose, if you're low risk you pay for years without ever needing to have paid. (Ignoring legal implications there)
HOWEVER It's like a johnnie isn't it. It's better to have one and not need one, than to need one and not have one.
#johnniejacksonweloveyou
The post in question was nothing short of disgraceful.
It came home to me at the weekend when I was looking at renewal (how come the premium goes up each year when there has been no claim for 20+ years and the car has depreciated in value?) and it occurred to me that we had been paying 50+ years of car insurance and 25+ years of house insurance for 3 claims totalling less than £3k. Insurance companies might carry the risk, but by God they set pretty poor odds.
I didn't compare the insurance industry and the service it provide to the NHS etc, in fact I specifically said it's not comparable (using the RNLI as an example) but that it does provide what many consider an essential service (I doubt there are many people on here who don't have some form of insurance).
The basic principle of insurance is that the premiums of the many pay for the claims of the few. So of course for everyone who claims £100k when their house has a fire despite only paying an annual premium of say £500 means insurers need probably 300 to pay £500 and not to claim. Hence why people who haven't claimed will question 'where's my money gone' - you have to view it like a pool, you might need to make a claim yourself at some point even if you haven't currently.
Over the cycle (say 10-15 years) insurers will aim to make about 5% per annum, the UK government will take more than double that, risk free - don't recall the last time the average jo public complained about that 12% of their premium.
Insurance and rates are cyclical, particularly in property cat where it's all or nothing (I'll come onto motor insurance), so when we've had a lengthy period of no losses premiums drop through the floor to the extent that the premiums of the many in that period will not cover the next big loss. We are quite easily talking here of this hurricane being a 100bn+ insured loss and I doubt the net premiums since hurricane Wilmer in 2005 will cover that. It's not a case of an excuse to hike up the rates, if over a cycle insurers/reinsurers do not break even there will be no insurance market as they'll be no money to pay claims.
Motor insurance is the one I struggle/disagree with - it's all priced on statistics and computers. It's a fact that the stats show someone who has a non fault claim is more likely to then have a fault claim that someone who didn't, hence why some insurers see post that non fault claim you being in a higher risk category and therefore premium. My arguement always is that you can run stats on hair colour and likely to cone out with a higher risk group..... the rating has gone too far. Very little of your motor premium is actually for the damage element, the majority is liability element and that's where the costs have increased considerably.
I won't bore you with an essay on the detail but google 'Ogden rate' - the reason motor insurance rates (and all other liability insurance) have recently gone up considerably is due to the government changing the Ogden discount rate. In one day that increased existing large liability claims by 100's of millions if not billions, and yes that additional cost is passed onto policy holders.
Lastly, the rates insurers charge as well as risk rating have many other factors. For instance 25 years ago motor insurers were happy to pay out £110 in claims for every £100 they received in premium. The motor market made an underwriting loss for 20 straight years from around 1985. That may seem odd, but in those days they would invest the premiums and easily make 20 points on investments so the business model was less about underwriting margin and more around investment.
You've probably all nodded off by now, but hope it clarifies my post and I'd reiterate my equal distain to the post we've all been talking about.
Did you know about 1/4 of the cost to run the London Fire Brigade is paid for out of insurance premiums? For every property insured in a London borough there is a levy of £35 per million of sums insured.
There is a levy (from memory about 8%) on some classes that goes to the FSCS to cover policy holder claims.
I've already mentioned insurance premium tax.
MIB is a levy on motor insurance premiums to cover the database of all motor insurance as well as to cover uninsured injury claims. There is a similar levy now for an employers liability database.
Take those out and add in say 20-25% of the premium in running costs it's on average about 50% is available for claims.
On rates, are you talking motor? There's many reasons, some I e described above, a few others are:
Injury claims have gone up both in severity and number is the past 10 years - blame the ambulance chasing lawyer 'no win no fee' brigade
Car repairs - due to safety cars are built to crumple these days and therefore even minor bumps are expensive compared to what they once were (also paint but that's a whole other subject).
A lot of the direct insurers, particularly on motor will hike it up each year often unnecessarily. My advice is find yourself a good broker, you won't see the hikes then and get a much better and more personal service.
Things like confused.com have made the public much more aware, but it's also led to a chase to the bottom and the majority of people won't care one jot who the insurer is just whose cheapest. This leads to the 'cheap rate for new customers' and higher rates for existing ones which in the long run isn't good.
We booked an October trip to Antigua a couple of weeks ago so I have been following with heightened interest, albeit from a rather selfish point of view. Seems Antigua got off lightly this time, though now Hurricane Jose is approaching. Barbuda, however, took the direct hit and seems to have been more or less obliterated - desperate for the people there.
Barbuda is part of same state as Antigua, but seems there are some big political differences - the Antiguan Gov issued a statement yesterday afternoon thanking anything and everyone for their escape - yet at that time there had been no contact with their tiny sister island.
My friend @SomersetAddick is currently in the Bahamas with his family including young grandsons but hopefully they will be flown home safely tonight.
President estimates 95% of homes have sustained damage with roofs at least partly missing if not gone completely.
Whole island 'reduced to rubble'
Desperately sad times.
A Commonwealth country - stump up May.